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Spokane, Washington  Est. May 19, 1883

Former Uber CEO Kalanick to resign from company’s board

Uber CEO Travis Kalanick arrives at the Vanity Fair Oscar Party in Beverly Hills, Calif., on Feb. 25, 2017. (AP)
By Cathy Bussewitz Associated Press

Former Uber CEO Travis Kalanick is resigning from the board of directors, severing ties to the ride-hailing company that he co-founded a decade ago and ran until a series of scandals led to his downfall.

The departure, announced Tuesday, did not come as a surprise. Kalanick recently sold more than $2.5 billion worth of stock in the company, or more than 90% of his holdings.

“Uber has been a part of my life for the past 10 years. At the close of the decade, and with the company now public, it seems like the right moment for me to focus on my current business and philanthropic pursuits,” the 43-year-old entrepreneur said in a statement.

Uber, based in San Francisco, turbocharged the gig economy, and its drivers have logged 15 billion trips since 2010. But Kalanick was ousted as CEO in summer 2017 with the company mired in lawsuits.

Uber under Kalanick grew with incredible speed, but like a number of other tech startups, it ran into trouble with a corporate “bro” culture that appeared at times to be spinning out of control. It was a problem Kalanick acknowledged. Before his ouster as CEO, he said he needed to “fundamentally change and grow up.”

His career at Uber seemed to fit a certain pattern seen in Silicon Valley: The brash and disruptive personalities who are great at creating startups can be ill-suited for the corner office when the company reaches maturity. Sometimes “adult supervision” in the form of experienced executives has to be brought in.

In one of Uber’s biggest scandals, Kalanick was accused of presiding over a workplace culture that allowed rampant sexual harassment.

A former Uber engineer, Susan Fowler, leveled sexual harassment and sexism allegations in a 2017 blog post, saying a boss – not Kalanick – had propositioned her and higher-ups had ignored her complaints. Kalanick called the accusations “abhorrent” and hired former U.S. Attorney General Eric Holder to investigate. Holder recommended reducing Kalanick’s responsibilities.

After multiple investigations, Uber fired 20 employees accused of sexual harassment, bullying and retaliation against those who complained. This month, the company paid $4.4 million to settle a federal investigation over workplace misconduct.

The problems went beyond employee relations.

Waymo, the self-driving car company spun off from Google, sued Uber in 2017, alleging a top manager at Google stole pivotal technology from the company before leaving to run Uber’s self-driving car division.

Uber also gained a reputation under Kalanick for running roughshod over regulators, launching in markets before officials were able to draft rules and regulations to keep the ride-hailing business in check.

During Kalanick’s tenure, The New York Times revealed that Uber used a phony version of its app to thwart authorities in cities where it was operating illegally. Uber’s software identified regulators who were posing as riders and blocked access to them. The U.S. Justice Department is investigating.

“Many investors will be glad to see this dark chapter in the rear view mirror,” Dan Ives, managing director of Wedbush Securities, said in a note to investors.

Kalanick is not alone among visionary tech entrepreneurs who have stumbled after building startups from nothing.

Tesla founder Elon Musk has had too loose a grip on his Twitter habit and has been fined by the Securities and Exchange Commission for misleading investors with a tweet. He was also sued for defamation, but ultimately cleared, for going on Twitter and calling a British cave explorer “pedo guy” – short for “pedophile.”

Adam Neumann, the former CEO of WeWork, recently stepped aside after the company canceled its initial public offering amid concerns about his judgment, including his use of company stock to secure a $500 million personal loan.

After Kalanick’s ouster, former Expedia CEO Dara Khosrowshahi was brought on as Uber’s chief executive to clean up Uber’s image and steer the company to its stock market debut in May. But Uber’s stock floundered and fell almost 11% in its first day of trading as a public company. It has tumbled more than 30% since.

“Let’s call it like it is: Uber stock has been a nightmare since the IPO coming out of the gates,” Ives said.